Do Medical Bills Affect Your Credit When Buying A House?

Yes, medical bills affect your credit when buying a house. Just like any blemish on your credit, it won’t put you in high favor with a mortgage lender.

How it affects your score depends on the credit model being used. The good news is Hospital Bills probably won’t affect it as bad as other factors.

Creditors don’t treat medical bills the same, and they shouldn’t.

If you get into an accident or have some sort of emergency where you don’t have your faculties together you can’t help what happens. Especially if someone else is making decisions for you.

In 2018, all three credit bureaus established a policy that gives all medical collections a grace period of 6 months. 

So, do creditors look at medical bills? Yes. Will medical bills hurt your credit score? Not immediately, but you want to stay on top it so it won’t hurt your chances of getting a fair mortgage for your house.

If this is a new situation, take advantage of the few months you have and pay off the bill. 


Do Medical Bills Affect Your Credit When Buying A house?

Yea, but are ways to avoid and manage the issue if credit repair is not an option.

disputing medical bills on credit report

What’s your EOB?

An EOB is an Explanation of Benefits Statement which gives detailed information about your medical insurance. You can see what portion of the bill is paid by you and what portion is paid by the insurance company. 

Make sure you understand it and call your insurance provider if there is any confusion. It really never hurts to call for clarification or free advice.  

Know your status and amount due:

Many issues occur because people simply don’t know how much they owe and who they owe it to. Countless times we’ve seen people who weren’t aware of their medical bills have been sent to collections or not.

There’s just too many hands in a pot: insurance, co-pays, deductibles, etc. 

Check your balance asap, don’t let it linger out of fear. The bill will be there and it won’t change without your attention.

Speak With The Collections Agency

Once it in collections, things get a bit tricky. Give them a call the verify everything on you bill, EOB. etc. It is best to have your documents together while on the call to cross-reference their information. 

You want to make sure there are no mistakes because they do happen often enough. 

If you are ready to pay it off or start a payment schedule, ask the agency if they will remove it off your credit report. You may even catch them before it affects your credit score.

This tactic is called Pay-For-Delete but collections agencies prefer the term “Tradeline Deletion”. It doesn’t mean that you pay collection to “forget about it” or that the bill vanishes.

You are simply trying to prevent your medical bill from hurting your credit score so you can buy a house. You can also pay someone to do it for you (more info here)

Related: Does Lexington Law Remove MD Bills?


Medical Debt Consolidation

Once medical bills show up on your credit report you still have options such as debt consolidation. You can avoid delinquent hospital bills from showing up on your credit report and lessen your monthly bills

A  debt consolidation loan can extend your repayment terms which can be a downside but it’s a give and take.

You have smaller payments for a longer period of time and it may increase your credit score (seek consultation from a pro you can explain your exact situation)

The better your credit, the better your chance of getting a new home.

Related: The Best Debt Consolidation Companies

James Willaims

Hey There, James here. I am the co-founder and editor of this site. I have over 10 years experience in business and 5 in the credit repair world